How does Parental Leave Affect Fertility and Return-to-Work? Evidence from Two Natural Experiments

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Article: article from journal or magazin.
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Publications
Institution
Title
How does Parental Leave Affect Fertility and Return-to-Work? Evidence from Two Natural Experiments
Journal
Quarterly Journal of Economics
Author(s)
Lalive R., Zweimüller J.
ISSN
0033-5533
Publication state
Published
Issued date
08/2009
Peer-reviewed
Oui
Volume
124
Number
3
Pages
1363-1402
Language
english
Abstract
This paper analyzes the effects of changes in the duration of paid, job-protected parental leave on mothers' higher-order fertility and postbirth labor market careers. Identification is based on a major Austrian reform increasing the duration of parental leave from one year to two years for any child born on or after July 1, 1990. We find that mothers who give birth to their first child immediately after the reform have more second children than prereform mothers, and that extended parental leave significantly reduces return to work. Employment and earnings also decrease in the short run, but not in the long run. Fertility and work responses vary across the population in ways suggesting that both cash transfers and job protection are relevant. Increasing parental leave for a future child increases fertility strongly but leaves short-run postbirth careers relatively unaffected. Partially reversing the 1990 extension, a second 1996 reform improves employment and earnings while compressing the time between births.
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09/09/2008 14:02
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20/08/2019 16:07
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